Govt Slaps $601 Mn Tax Bill on Samsung for Telecom Imports

India has ordered Samsung and its executives in the country to pay $601 million in back taxes and penalties for dodging tariffs on import of key telecoms equipment, a government order showed, for one of the biggest such demands in recent years.

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The demand represents a substantial chunk of last year's net profit of $955 million for Samsung in India, where it is one of the largest players in the consumer electronics and smartphones market. It can be challenged in a tax tribunal or the courts.

The company, which also imports telecoms equipment through its network division, received a warning in 2023 for misclassifying imports to evade tariffs of 10 or 20 per cent on a critical transmission component used in mobile towers.

It imported and sold these items to billionaire Mukesh Ambani's telecom giant, Reliance Jio.

Samsung pushed India's tax authority to drop the scrutiny, saying the component did not attract tariffs and officials had known its classification practice for years.